This is the first of four reports taking a deep dive into Canadian airports in 2018

• Next week: Where airports spent their – your – money
• May 25: The airport’s “tax”, Airport Improvement Fees
• June 1: Non-aeronautical revenues, growth on the ground

Canada’s airports reported overall revenues of more than $4 billion in 2018, rivalling such huge revenue generators as the city of Toronto’s property taxes, and more than doubling all the revenues collected in Prince Edward Island last year.

An analysis of new figures published by 19 of the 23 airports in the National Airports System by Western Aviation News has shown that together, the facilities account for more than $3.5 billion in spending, and generate surpluses last year of $257 million. Those profits were 61% higher than the year before, as both of Canada’s national airlines, Westjet and Air Canada, transported record numbers of passengers.

Facilities in the NAS are designated by Transport Canada and cover every province. They account for 94% of all air passengers in the country, and together, these airports processed more than 145 million arriving and departing passengers in 2018. They are generally operated by independent airport authorities, though Kelowna is run by the city.

An analysis of the data shows that just four hub airports – Calgary, Montreal, Toronto, and Vancouver – account for 75% of all airport revenues across the country.

Not surprisingly, as Canada’s busiest airport, Toronto-Pearson brought in the most revenue last year, almost $1.5 billion, generating a profit of $145 million, up 29% over 2017. Things went so well in Toronto last year, the airport authority paid down almost $30 million in debt early, reducing its overall debt burden. Profits at airport authorities are plowed back into facilities or placed in cash reserves.

Toronto’s growth is due mainly to Air Canada, the country’s largest airline, funnelling passengers through the city, to destinations around the world, egged on by incentives contained in a deal first signed in 2014.

“The non-exclusive agreement,” reads the airport’s annual report, “includes fixed annual aeronautical fees for Air Canada and its family members, inclusive of landing fees, general terminal charges and apron fees.

“If Air Canada exceeds passenger growth thresholds in a given year, it will be eligible for a rebate.”

Toronto’s position as Canada’s main hub has generated millions of additional passengers each year and represented 30% of all traffic. “The more we become a hub of choice, the better we’re able to serve our surrounding communities,” said Pearson’s board chair David Wilson.

“Toronto Pearson is now recognized among the top 30 international mega-hubs worldwide,” said Wilson.

Montreal was next in Canada, generating $645 million in revenue, and a profit of $68 million. Vancouver, despite handling six million more passengers than Montreal, generated $565 million in revenues, and a profit of $102 for the year. The big difference? Vancouver spent almost $200 million less on operations than Montreal over the year.

Calgary, the fourth-busiest airport in Canada and Westjet’s main hub, generated $420 million in revenues, but stood out as the only major airport in Canada to generate a loss on the year of almost $145 million. The loss in 2018 was 1.5% worse than the operating loss in 2017.

The airport has also racked up massive amounts of debt, maxing out its credit card, so to speak, to the tune of $2.9 billion. The airport has invested heavily to add a new runway and greatly expand its international facility in recent years. A deal with a provincial funding agency allows the airport to borrow up to $2.99 billion for capital projects at favourable interest rates.

As the country’s largest airport, Toronto was Canada’s largest airport debtor, accumulating almost $6.4 billion in money owed, though on a per-passenger basis, the load is smaller than Calgary’s.

Among the next tranche of airports, Edmonton stood out last year, generating more passengers and revenues than any other non-hub airport. In 2018, YEG brought in $233.8 million in revenues and essentially breaking even on the year, a great improvement over 2017 when the oil recession led the airport to generate a $3.3 million loss.

In its annual report, the Edmonton airport authority said ultra low-cost carriers – Flair and Swoop, which are waging a pitched battle in the Alberta capital – accounted 10% of all passengers using the terminal in 2018, representing the fastest-growing segment of the market. The number of ULCC seats at the airport jumped 374% in one year.

Winnipeg ($138 million) and Ottawa ($131 million) generated the next-most revenues, followed by Halifax ($111 million).

Quebec City stood out among the smallest airports in the National Airports System, generating more than $66 million in revenues in 2018, and a profit of $11 million. Victoria International generated similar profits, despite significantly lower revenues (%39.5 million).

Victoria is unusual among Canadian airports in that it has no debt – along with Saskatoon, it was one of only two major airports to make the claim. That’s despite spending more than $15 million on a terminal expansion in 2018, a project that will be completed in 2019.

In next week’s Sunday reader, an in-depth look at where airports spend their cash.